Hall v. Crandall

By the Court, Sanderson, J. The note in suit is the same which was sued upon in Hall et al. v. The Auburn Turnpike Company, 27 Cal. 255. For reasons there stated we held that the note was not binding upon the company. It is now sought by this action to hold the Directors of the company personally liable.

It is claimed that the defendants are liable: first—because the nineteenth section of the Act under which the company was incorporated so provides; and second—because they are made liable by the common law.

We are of the opinion that the second point cannot be sustained, for the reason that the action has not been brought upon the theory of a common law liability. The facts stated in the complaint and found by the Court are not only not marshalled with reference to a common law liability, but in our judgment are not sufficiently stated to fairly present that question. On the-contrary the complaint is fashioned solely upon the theory advanced in the first point, and it is apparent from the record that the case was tried, argued and determined throughout in the Court below upon the theory of a statutory liability. Ho point was made upon the common lawj as clearly appears from the opinion delivered by the District Judge. Moreover, the case was first submitted in" this Court upon that [571]theory, and the point that the defendants were liable at common law was afterwards made in a supplemental brief.

But upon this head it is sufficient to say that the present action is founded strictly upon the note itself, and not upon the wrong done to the plaintiffs by the defendants in executing it without authority; and we are of the opinion that if the defendants have, by their action in the premises, incurred a personal liability at common law, such liability does not arise from any obligation created by the note itself, but from the wrong done. In all such cases the remedy against the. agent is an action to recover the money, if any has been paid him, or the value of the work or labor, if any has been performed for him, under the supposed contract, or special damages resulting to the plaintiff by reason of the defendants’ wrong in undertaking to act for another without authority. If an agent in executing a contract, employ terms which, in legal effect, charge himself, he may be sued upon the instrument itself as a contracting party. This is so because by the use of such terms he has made the contract his own. But if the instrument does not contain such terms, or in other words contains language which in legal effect bind the principal only, the agent cannot be sued on the instrument itself for the obvious reason that the contract is not his. If then the contract is not binding upon the principal because the agent had no authority to make it, and is not binding on the agent because it does not contain apt words to charge him personally, it is wholly void. Upon this point there is some conflict of authority, but the better reason, in our judgment, is with those cases which hold the rule to be as above stated. (Story on Agency, Fifth Ed., Sec. 264, a, and marginal notes, where the authorities are collected ; 1 Parsons on Contracts, 54 to 58 ; Abby v. Chase, 6 Cush. 54. See also Sayre v. Nichols, 7 Cal. 538; Davidson v. Dallas, 8 Cal. 247; Haskell v. Cornish, 13 Cal. 47; Shaver v. Ocean Mining Company, 21 Cal. 45, which will „be found to bear in some degree upon the question.) Those cases, which hold that the agent may be sued upon the contract itself, treat all matter which the contract contains in